An Inferior Good Is

question 223

Multiple Choice

An inferior good is:

• A) any good of low quality.
• B) one that consumers buy less of at a higher price.
• C) one that consumers buy less of as their income rises.
• D) one that has few substitutes.
• E) any good made with inexpensive labor.

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Definitions:

Accounts Receivable

The amount customers are yet to pay a company for goods or services that have already been delivered or performed.

Income Statement

A financial statement that reports a company's financial performance, including revenues, expenses, and profit, over a specific period.

Direct Method

A way of preparing the cash flow statement where actual cash flow information from the company's operations section is used rather than being derived from the income statement.

Prepaid Expenses

Costs paid for in advance of their use or consumption, recorded as assets on a balance sheet and gradually expensed over the period of use or benefit.